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COMMENTS ON TSH RESOURCES BERHAD (9059) - louisesinvesting

Tan KW
Publish date: Fri, 03 Jan 2020, 02:52 PM
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 COMMENTS ON TSH RESOURCES BERHAD (9059)


FIGURE 1: TSH RESOURCES BERHAD LAST 2 YEARS SHARE PRICE TREND
 
**analysis based on 2018 annual report.
1.       GENERAL INTRO: TSH is one of the main oil palm plantations in Malaysia.
 
2.       NOTABLE POINTS:
a.       In 2018 report, main business segments include operation of oil palm plantations and palm oil mills, which generates about 85% of the Group's revenue.
b.      the Group operates oil palm estates in Sabah and parts of Kalimantan and Sumatra in Indonesia with a total planted area of 42,000 hectares and total annual fresh fruit bunches (FFB) production of 857,802 MT.
c.       the group also operate 7 palm oil mills in Malaysia and Indonesia
d.      the Group’s other business activities include the operations of biomass and biogas power plants in Sabah; industrial tree plantation at the Forest Management Unit in Ulu Tungud, Sandakan, Sabah; manufacturing and marketing of engineered hardwood flooring; and processing and marketing of cocoa products.
e.      reported decreasing revenue in 2018 was due to lower CPO selling prices.
 
3.       IS THIS COUNTER A STRONG GROWTH STOCK? 
a.       REVENUE RANGE (million): ~906.4 million in 2018 annual report, this is a medium revenue company.
b.      SHARE PRICE: from 2018-2020, share price has been decreasing from around RM 1.60 to RM0.80, by end of 2019, abruptly raised to around RM1.50
c.       EARNING PER SHARE (EPS): earning per share in last 5 years fluctuated from -7.85 to 10.31sen
d.      FUTURE POTENTIAL/PROSPECTS: share price expect to be stable in the next few years
e.      CAPITAL EXPENDITURE (CAPEX): spending on purchase of new fixed assets is RM 151 million, around 4% of total assets.
 
4.       IS THIS A STRONG DIVIDEND STOCK?     
a.       DIVIDEND YIELD: in 2018 financial year, TSH declared a dividend payout of 2 sen per share to shareholders, which amounts to a dividend yield of 1.29%.
b.      CONSISTENCY: the dividend payout was consistent, last five years (2015-2019) dividends declared range between 2 to 2.5 sen per share.
c.       DIVIDEND PAYOUT RATIO: current financial year dividend payout ratio was 68%.
 
5.       IS THE MANAGEMENT PERFORMANCE GOOD?
a.       RETURN ON EQUITY (ROE): in 2018 financial year, TSH achieved a low return of shareholders’ equity, at 3.45%.
b.      COST-TO-INCOME RATIO: cost-to-income ratio is high at 1010%.
 
6.       OTHER INDICATORS:
a.       CASH FLOW: cash flow is positive, around RM 99.9 million, equivalent to RM 0.07 per share
b.      SUPPORT BY INSTITUTIONAL INVESTORS: this counter is moderately well supported by institutional investors, there are 15 institutional investors at top 30 major shareholders list, including EPF (7.05%), KUMPULAN WANG PERSARAAN (3.84%) and few insurance companies and investment funds. Its major shareholder is Datuk (Dr.) Kelvin Tan Aik Pen (12.23%).
 
Disclaimer: The content of the blog posts are for sharing purpose only. Readers are encouraged to carry out further research and analysis as well as follow up latest update information before making any investment decisions.
 
 
http://louisesinvesting.blogspot.com/2020/01/comments-on-tsh-resources-berhad-9059.html

 

TSH (9059)
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